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Prioritizing Projects

The California Department of Transportation and the California Air Resources Board have developed an easy method for comparing the cost-effectiveness of projects designed to reduce emissions, based on the amount of emissions that the project eliminates for every dollar spent. Although not a true benefit-cost analysis, this method can be used for prioritizing projects on the basis of their air quality impacts. It can be used for many types of projects, such as new bus service, replacement of old vehicles with cleaner vehicles, ridesharing, and traffic signal coordination.

The method uses the following steps:

  • Determine how much the project will cost
  • Identify the expected life of the project and reduction in vehicle miles traveled (VMT)
  • Calculate a capital recovery factor, which adjusts the project's cost based on the discount rate and the expected life of the project
  • Use a formula to calculate the cost per pound of emissions reductions

Once the cost per pound of reductions has been calculated, projects can be compared to each other to see which has the lowest cost per pound of emissions.

For more information, download the report at: http://www.arb.ca.gov/planning/tsaq/eval/hc03v2.pdf, which includes many detailed examples of different types of projects.

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